Microsoft has weighed restructuring or spinning out its struggling Xbox unit, including options like making it a wholly owned subsidiary or a joint venture, though no move is imminent, according to The Information. New Xbox CEO Asha Sharma is preparing significant layoffs and studio cost cuts while pushing more spending on new games from top franchises like Halo, Fallout, and Elder Scrolls, which would leave the overall game-development budget roughly flat YoY. The shake-up follows a memo Sharma made public this week showing Xbox’s profit margin had fallen to just 3% and revenue declining over five years, excluding Activision Blizzard, which Microsoft bought for $75B in 2023.
